BLBG: Copper Gains for Fourth Day on Speculation About Chinese Demand
Copper rose for a fourth day on the London Metal Exchange on speculation that purchases in China, the world’s biggest buyer, will erode global supplies. Aluminum and zinc also extended gains.
Copper inventories monitored by the LME, the world’s biggest depository of all industrial metals, fell to 545,475 metric tons, an exchange report released today shows. The amount of copper scheduled to be taken out of warehouses, known as canceled warrants, jumped to the highest in a year.
“It’s being influenced by Chinese traders,” said Max Layton, an analyst at Macquarie Group Ltd. in London. “Weaker metals like aluminum and zinc are being supported by actual Chinese buying.”
Copper for three-month delivery jumped as much as $70, or 2.1 percent, to $3,480 a ton, the highest since Feb. 13. The contract was at $3,455 a ton at 10:12 a.m. local time. It has added 9.5 percent in February, heading for the biggest monthly advance in a year. Aluminum and zinc climbed for a third day.
“There is some consumer buying, although limited at the moment” in copper, said Michael Khosrowpour, an analyst in London at Triland Metals Ltd., one of 12 traders on the LME floor. “We may observe a typical price-action pattern of an a.m. session rise and a p.m. session fall. Of course, this depends upon the data coming out later today.”
New Homes
U.S. durable-goods orders probably fell 2.5 percent in January, the median estimate of economists surveyed by Bloomberg News shows. New-home sales probably dropped 2.1 percent at the same time, according to a separate Bloomberg survey. The durable- goods report is due at 1:30 p.m. London time, followed by the housing report at 3 p.m.
The U.S. is the biggest buyer of copper, used in plumbing and electrical wiring, after China. President Barack Obama has signed into law a $787 billion stimulus bill aimed at stemming a slump in growth. China may boost imports of refined copper by 37 percent this year, bolstering world prices as recessions slash U.S. and European demand, according to Trafigura Beheer BV.
Aluminum for three-month delivery rose $6.50 to $1,349.50 a ton, and zinc advanced $2 to $1,147 a ton. Tin added $25 to $10,775 a ton, nickel jumped $200 to $10,275 a ton, and lead gained $6 to $1,036 a ton.
